Boston, MA 04/14/2014 (wallstreetpr) – Texas Instruments Incorporated (NASDAQ:TXN) is a chipmaker organization that carries market value of $49 billion. The company’s peers include Intel Corporation (NASDAQ:INTC) and ASML Holding NV (ADR) (NASDAQ:ASML), just to mention a few.
The company is making interesting executions that should result in greater value to shareholders, more than its rival Intel Corporation can deliver in the short term. For example, the company is seeking to convert about 30 percent of its revenue to free cash flow. Moreover, the company can be seen putting in place better cost-cutting measures, which should result in better profits and make the stock more appealing to the investors. According to the company’s executives, they are looking to achieve strong free cash flow position as that is important in enhancing shareholder value for the long-term.
Does recent performance reveal anything?
The company can be seen increasing its profit steadily in the past year. For example, it reported profit of $511 million in the fourth quarter of 2013. That profit figure was almost double the profit in the fourth quarter of 2012 that was $264 million, suggesting a significant and encouraging profit growth over one-year timeframe. Revenue during the same time frame jumped 2 percent.
As it can be clearly seen, a small increase in revenue resulted in huge increase in profit that suggests that cost-cutting measures are paying off well. Texas Instruments Incorporated (NASDAQ:TXN) is focused on making annual saving of $130 million going forward.
What sets TXN and Intel apart?
While Texas Instruments Incorporated (NASDAQ:TXN) can manage to talk about increasing revenue and profits, Intel can only envy the same. The world’s top chipmaker by volume is under pressure as revenue is not only forecast to remain flat this year, but profit margins have also narrowed as the company cuts product costs to entice customers. Moreover, the company is in the middle of a transformation, which involves layoffs that may result in more costs to the company and the shareholders.
As Intel struggles to stay aloft, Texas Instruments Incorporated (NASDAQ:TXN) is busy attracting new investors while happily keeping the current ones as it brings breakthrough products to the market and entering lucrative partnership arrangements.
